Early signs that 2023 will bring about a global recession as markets across the world report sluggish activity have resulted in the first big casualty for the supply chain industry, the loss of some 600 jobs.
This has emerged after it was reported from London that the multinational logistics service provider, Flexport, has decided to cull its workforce by about 20%.
Restructuring at the company, announced to employees in a bitter-sweet circular, will result in widespread job losses in the United States, Northern Europe and Asia.
According to Flexport, the decision to lay off about a fifth of its staff complement was necessitated by decreasing volumes, paradoxically exacerbated by improved systems efficiencies.
Technological progress, it seems, set in motion an unfortunate spread of human resource obsolescence which, in tandem with a global slump in demand, led to the reconsideration of certain positions.
The shedding of posts will reportedly be effected across the board in all departments.
However, although the jobs cull signals a reduction in the company’s size, sources have indicated that Flexport will remain active in all its current locations and that no offices will be closed.
At the same time, and indicative of the company’s growing systems ability, it has also emerged that Flexport will be appointing up to 400 people in engineering and software positions.
News of the cull, while the company is looking for additional expertise, was carefully worded in a circular sent out by Dave Clark and Ryan Petersen, Flexport’s co-CEOs.
It was clearly not an easy decision, and they emphasised that planning ahead meant absorbing macroeconomic impacts experienced by the company’s clients.
Primary among these is the widely held expectation of a cargo downturn for the year ahead.
